Oregon sues Coinbase, seeks to fill federal ‘enforcement vacuum’

Oregon’s attorney general on Friday sued the cryptocurrency exchange Coinbase and said the lawsuit was necessary because of the dismantling of federal regulatory agencies.
The 171-page lawsuit, filed in Multnomah County, alleges Coinbase is violating the state’s securities laws by facilitating the sale of virtual currencies that don’t come with proper disclosures.
“You don’t go in for a medical procedure without knowing the risks,” Oregon Attorney General Dan Rayfield said in a press release. “It’s the same for everyday folks who want to invest in cryptocurrency. I am committed to protecting Oregon’s investors so they’re not taken advantage of.”
The lawsuit was filed roughly two months after the U.S. Securities and Exchange Commission dropped a similar case, which Rayfield’s office characterized as showing the “enforcement vacuum” being created under the Trump administration.
Coinbase’s top lawyer blasted the lawsuit in a series of posts on the social media site X, characterizing it as “resurrecting the dead,” “political jockeying” and an “embarrassing waste of Oregon taxpayer dollars.”
“In case you think I’m jumping to conclusions, the AG’s office made it clear to us that they are literally picking up where the Gary Gensler SEC left off,” wrote Paul Grewal, Coinbase’s chief legal officer. “This is exactly the opposite of what Americans should be focused on right now. We’ve never been closer to bipartisan legislation for digital assets and this backward lawsuit does nothing to protect consumers or solidify American leadership.”
Under Oregon law, securities must be registered with the state or the federal government, and material information must be disclosed to investors. The lawsuit alleges that the absence of information about the cryptocurrencies sold on Coinbase makes them conducive to fraud.
In a blog post, Grewal, Coinbase’s lawyer, disputed that virtual assets are securities.
“As everyone knows, the war against crypto waged by the previous SEC and its allies is over—crypto won,” he wrote. “The SEC finally caught up with the reality that the vast majority of digital assets are not securities—and that there is widespread public support for this revolutionary technology.”
The lawsuit seeks a jury trial and penalties that include a $20,000 fine for each of Coinbase’s alleged violations of Oregon securities law.
– Matthew Kish covers business, including the sportswear and banking industries. Reach him at 503-221-4386, mkish@ or @matthewkish.
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